North Dakota: House OKs bill to limit governor's ability to set comp rates
Currently, workers' comp rates in North Dakota are set by the board of directors of the state's Workforce Safety and Insurance agency after a review by an independent actuary of the organization's assets and liabilities, as well as any potential changes in benefits. However, under the recently approved H.B. 1036, the board of directors would be limited in its ability to change the actuary's premium rate recommendation. The legislation would require that the statewide average premium rate level not deviate by more than 5 percentage points from the actuary's recommended rate.
Lawmakers said the bill was aimed at limiting the governor's power to set and change comp rates after a measure that was approved by voters in November. In the election, 67 percent of voters approved a proposal to permit the governor of North Dakota -- rather than the appointed board of directors -- to hire the director of the WSI. Under the state's previous system, the appointed board of directors had the authority to hire the chief executive officer of the agency. Supporters of the measure had collected more than 15,000 signatures on petitions to land the proposal on the ballot.
Supporters of the bill, including Rep. George Keiser, R-Bismarck, suggested that previous North Dakota governors had pushed for too great of rate reductions that have placed the state's insurance fund at risk. Since the governor now has the power to hire the head of the workers' comp agency, some lawmakers felt that it might allow for too much political influence in the rate-setting process.
The measure approved in November also requires the agency to use independent administrative law judges when determining workers' comp claim disputes. The WSI previously had the authority to reject the decisions of administrative law judges. It also provides civil service protection to WSI employees, who currently can be dismissed for any reason.
The agency has been under public scrutiny since late 2007 when it fired its chief executive officer, Sandy Blunt. Criminal charges had been filed against Blunt and Romi Leingang, investigations director, for allegedly misappropriating state funds and conspiring to release confidential information. However, the charges were later dropped.
The bill now heads to the Senate for debate.
February 2, 2009
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